Many farming clients have mortgages over their land.
It is of paramount importance that farming businesses have in place the most useful financial support possible, especially during times of uncertainty. It is worth undertaking a review of your charged and uncharged land to see whether your position could be improved should you need to increase your borrowing quickly in the future.
Every secured lender will require a legal charge over the property or properties you put forward as security. This secures all sums owed to a lender, both at the time the charge is granted and at any point up until the charge is released; this can even include your overdraft which fluctuates on a daily basis.
As well as a legal charge, it is becoming increasingly common for lenders to require a debenture where the farming business is a company rather than a partnership or owned by individuals. A debenture ensures security over the assets of the business as well as the land over which the bank secures a legal charge. If the business is a limited company, the directors may also need to provide personal guarantees.
We will report the terms of the security granted and negotiate between the borrower, lender and any brokers involved. Wherever possible, we aim to ensure that no more security than is necessary is granted and that personal guarantees are limited to specific sums to minimise risk.
Our reliable and efficient agriculture team understand that every secured lending situation is different and tailor their advice to the business objectives. Our highly regarded and friendly agriculture and estates solicitors can assist with new deals or refinancing where the monies are to be secured against your land.
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Our specialist Banking and Finance team bring together expertise from acting for both lender and borrower clients involved in a wide range of transactions. Now and then, most businesses need an injection of capital.
